Financing the Decarbonisation of Freight Transport

Decarbonising UK Freight Transport (DUKFT) today publishes its report ‘Financing the Decarbonisation of Freight Transport’. It finds that the role of policy makers, data, and supply chain stakeholders are key to unlocking finance – and accelerating the decarbonisation of freight transport.

The findings, summarising DUKFT’s first event held earlier this year, show that while there is consensus on the need to decarbonise and a shortlist of technology and fuel options exist, policy makers need to do more to drive the decarbonisation of freight transportation. This could be achieved by setting ambitious targets, providing adequate market signals through pricing emissions and de-risking key technologies through pilots.

The event sought to explore the nature of decisions investors are making today which impinge on decarbonisation, the accuracy of evidence that investors need to make decarbonisation-aligned decisions and the key stakeholders that need to use that evidence to make a meaningful impact in decarbonising the freight sector.

In terms of the data and thresholds of accuracy for climate-aligned decision making, the panels and the discussions suggested that high accuracy and availability of information are not the barriers in decarbonising the UK’s freight sector, rather there is a need to build consensus and trust on valid approximations across the various actors of the value chain in a transparent and consistent manner.

The key stakeholders that are required to spur decarbonisation of the freight sector included those in either end of the value chain, including financiers/capital providers and cargo owners/customers, rather than the vehicle owners themselves.

Dr Nishatabbas Rehmatulla, Senior Research Associate at the UCL Energy Institute, Co-Investigator and manager of the DUKFT network said: “We know there are number of barriers common to investments in energy efficiency and specific to climate alignment which make the process of aligning assets and investment portfolios challenging in practice. This event and report show where the focus should be in order to overcome these; the role of public policy can be a crucial signal to the market. It is often assumed that high fidelity accurate data is needed for investment decision making but the event showed that reasonable and transparent approximations are equally as useful for the stakeholders in the financing community”


The full report is available here.